* Third-quarter EPS $1.20 tops Wall St view of $1.16/shr
* Revenue falls 5 pct to $16.65 bln; St expected $16.90 bln
* Stands by full-year 2012 outlook
By Martinne Geller
Oct 17 (Reuters) – PepsiCo Inc reported
higher-than-expected quarterly earnings on Wednesday, despite
weaker revenue caused in part by the stronger U.S. dollar and
the exit of certain businesses.
The maker of Diet Pepsi, Frito-Lay snacks and Tropicana
orange juice said third-quarter net income was $1.90 billion, or
$1.21 per share, down from $2.00 billion, or $1.25 per share, a
year earlier.
Excluding restructuring and other charges and a gain on
commodity hedges, earnings were $1.20 per share. On that basis,
analysts on average were expecting $1.16 per share, according to
Thomson Reuters I/B/E/S.
Revenue fell 5 percent to $16.65 billion, below analysts’
average estimate of $16.90 billion.
Excluding the impacts of currency fluctuations and the
refranchising of its bottling businesses in China and Mexico,
revenue grew 5 percent, reflecting 1 percentage point of volume
growth and 4 percentage points from price increases.
The results come a day after rival Coca-Cola Co also
reported weaker-than-expected revenue, hurt by declines in
Europe and the Pacific region.
In the third quarter, overall sales volume rose 6 percent in
the snack business, after acquisitions lifted sales in Latin
America. In North America, volume rose 1 percent at Frito-Lay
and 2 percent at Quaker Foods.
PepsiCo’s Americas Beverage business saw volume fall 3
percent.
The company also affirmed its full-year outlook, which calls
for earnings per share to fall 5 percent from the $4.40 it
earned in 2011, and revenue to increase by a low single-digit
rate reflecting the changes in China and Mexico.
For PepsiCo, 2012 is a transition year, as it ramps up
marketing, cuts thousands of jobs and streamlines its portfolio
to improve performance, especially in its North American
beverage business.
So far this year, the company has introduced Pepsi Next, a
mid-calorie cola, and started a new global marketing campaign
for its flagship Pepsi brand.
The company has incurred restructuring charges of $193
million through the third quarter related to its productivity
program. It expects additional charges of $205 million in the
remainder of 2012, and $129 million from 2013 through 2015.
